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DEAG plans to delist as takeover offer agreed

MyTicket owner Deutsche Entertainment AG (DEAG) has revealed plans to delist from the Frankfurt Stock Exchange after securing the support of the entertainment firm’s largest single shareholder.

In an agreement, signed today (Monday) with Apeiron Investment Group and its bidder company Musai Capital, the submission of a public delisting-takeover offer was agreed as a requirement for the delisting.

The management board and the supervisory board will remain with DEAG, while all existing contracts with employees, service providers and artists shall remain in full force and effect.

Peter Schwenkow, chief executive and founder of DEAG, told TheTicketingBusiness: “We are very proud that we could convince our major shareholders to invest additional money to delist DEAG, which we think is the right move these days as you can do strategic movements without worrying about quarterly announcements, as is required with a public company.”

When asked about the additional money invested, Schwenkow could not reveal exact numbers, but did say it was “much more than we could ever collect from the capital market in the next two years.”

He added: “It is the right move for us right now, with live events to be back in full next summer. We have to admit the timing is right. If the share price is back at €7 we could not convince investors to move.

“The move allows smaller investors to sell shares to us and not worry how long it will take for the industry to be back.”

The move will see the German group retain its legal form as a stock corporation and to continue the listing of the corporate bond 2018/2023 on the Open Market of the Frankfurt Stock Exchange.

Musai, a wholly-owned subsidiary of Apeiron, DEAG’s largest single shareholder with approximately 18 per cent of stock, has announced a share purchase offer with a consideration in cash, calculated according to the volume-weighted average share prices of the last three and the last six months as required by law for a delisting-takeover offer.

The price is currently €3.07 per DEAG share, though the final price will be published by Musai in the offer document after confirmation by the German Federal Financial Supervisory Authority. As a delisting-takeover offer, it will not be subject to any closing conditions.

Together with the US investor Mike Novogratz, who holds approximately 14 per cent of DEAG’s shares through his family office Galaxy Group Investments LLC, as well as other existing shareholders of the company, Apeiron and Musai have agreed on the key terms of a shareholders’ agreement.

The withdrawal from the regulated market of the stock exchange requires a prior public delisting-takeover offer to the shareholders of DEAG, so that all shareholders can still sell their shares prior to the delisting.

The parties to the shareholders’ agreement, which in total hold approximately 47 per cent of the shares, have indicated they will not accept the planned offer for their DEAG shares. On the basis of the shareholders’ agreement, subject to the successful closing of the transaction, they will exercise joint control over DEAG.

In the agreement with DEAG, Apeiron and Musai have committed to support the firm’s further growth strategy outside the stock exchange listing.

The company said the management board and supervisory board of DEAG will issue a reasoned statement on the public delisting-takeover offer after publication of the offer document.

Schwenkow said: “Despite the continuing uncertainties about the future of the live entertainment industry due to the ongoing restrictions, DEAG is pleased about the continuous support and trust of all members of the management board, the supervisory board, all managing directors, partners, co-shareholders and the current major shareholders who wish to continue to jointly pursue DEAG’s existing growth course in an unlisted environment of the company.”